Boeing’s 2013 deliveries soar to record despite 787 woes

Boeing’s local blue-collar workers, who last week reluctantly gave up their pensions under threat of losing future work, pumped out more jets in 2013 than ever before.

And Boeing’s jet sales for the year, according to figures released Monday, were the second-highest in company history.

Despite the grounding of the 787 Dreamliner for more than three months early in the year after two battery-fire incidents, production of that jet went on unfazed.

By the end of the year, the 787 had ramped up to the planned production rate of 10 per month, and 65 Dreamliners were delivered to customers in the year, five more than the target set before the grounding.

The record-high delivery total of 648 jets in the year, a 7.8 percent increase from 2012, positions Boeing to retain its crown as the world’s largest plane-maker for a second straight year.

The previous Boeing record production of 620 jets was set in 1999, and included 59 jets built in the former McDonnell Douglas plant in Long Beach, Calif., and 561 jets built in the Puget Sound-area factories.

The 2013 total included 634 jets built in Puget Sound region factories and just 14 Dreamliners built in North Charleston, S.C.

The 737 program in Renton delivered 440 of the smaller 737s, an all-time high.

And Everett delivered 98 of the large 777s, also a record.

Rival plane-maker Airbus, which will release its 2013 results in a week, trailed Boeing through the first 11 months of the year with 562 deliveries.

According to a Seattle Times analysis of the data, at list prices the total value of the jets Boeing delivered was about $96 billion.

However, jet prices are heavily discounted in negotiations with buyers. Using estimates of market pricing from aircraft-valuation firm Avitas, the real dollar value of Boeing’s 2013 deliveries after standard discounts is about $51 billion.

Aircraft sales also surged as carriers globally took advantage of low-cost financing to replace older models with newer, fuel-sipping jets.

Boeing’s total of 1,355 net orders for the year was the second-highest annual sales tally ever, and an increase from 1,203 net orders a year earlier.

Airbus reported 1,314 net orders for the year through the end of November. The plane-maker could nose out Boeing with a higher annual sales tally after recording 50 firm A380 orders from Emirates in December.

The forthcoming 777X jet, which Boeing said will be built in Washington state because of the Machinists vote last week, featured in the sales tally, but not as prominently as expected.

Boeing launched the 777X with great fanfare at the Dubai Air Show in November touting commitments for 259 of the massive jets.

However, only 66 firm orders had been booked by the end of the year.

Some airline customers may have been reluctant to sign on the dotted line before they were sure the jet would be built in Everett — which is much less risky for Boeing than building it elsewhere.

If so, then the 777X should add many more sales in the year ahead.

The Seattle Times analysis of the 2013 data shows Boeing’s firm net sales were worth about $202 billion at list prices.

Using Avitas estimates of market pricing, the real dollar value of Boeing’s 2013 sales after standard discounts is about $104 billion — close to a record.

Boeing’s all-time sales high was in 2007 when it had net orders for 1,413 jets, worth an Avitas-estimated discounted value of $106 billion.

However, in subsequent years, well over 200 of the 2007 sales were canceled. Only 1,179 of them still stand.

Inevitably, some portion of the 2013 sales will also evaporate in coming years.

In a message to employees Monday, Boeing Commercial Airplanes CEO Ray Conner called 2013 “a year of incredible highs and lows.”

The low point was the grounding of the 787, which Conner called “a major test of our ingenuity and resolve.”

Boeing halted deliveries of the jet after regulators ordered the global fleet grounded to investigate electrical-system issues that caused lithium-ion batteries to smolder on two of the jets.

After satisfying regulators and customers with its safety fixes, Boeing accelerated the 787’s production rate to its 10 jets per month goal, the highest-ever output for a widebody-aircraft model.

Boeing investors sent the stock soaring through 2013, unfazed by the 787 grounding.

The company’s ability to generate cash by ramping up deliveries of profitable models such as the 777 and 737 sent shares up 81 percent in 2013.

Boeing stock Monday closed at $138.41, up 79 cents, or less than 1 percent.

Conner’s letter to employees praised the workforce for its achievements in 2013 and, with a nod to the deal sealed Friday in a contract vote by the Machinists union, he looked ahead to 2014.

“We’re starting 2014 on firmer footing thanks to the eight-year contract extension approved Friday,” Conner wrote. “As difficult as the issue was, the outcome provides stability and a clear course for the future, while ensuring years of employment opportunity for Boeing’s skilled workforce.”

The deal required the Machinists to sacrifice their pensions and to take other concessions, including increased health-care costs and wage increases of just 1 percent every other year.

“This is an amazing team,” Conner added in his letter. “I want to recognize everyone’s outstanding work over the past 12 months.”